Fixing the News: Blockchain-Powered Solutions for Media in Crisis

Many believe that the news is broken. The time has come to decentralize it.

A handful of blockchain-driven media startups that aspire to revolutionize the news economy are different in this important sense

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In depth

In the US and around the world, quality journalism is going through difficult times. Against the backdrop of steadily declining trust in the mainstream press, systemic issues like the ever-intensifying political polarization of the media, proliferation of fake news, and asymmetric power relations between platforms and publishers, among others, stand in the way of the press striving to fulfill its crucial societal functions. The central role of the media in the society is, at least normatively, to provide the public with essential knowledge of the state of the world that would enable people to make informed choices. In a democracy, both institutional and social media are also supposed to facilitate an open arena for public discussion and deliberation where the wide array of voices and ideas are represented. However, the reality seems to be drifting away from this ideal in dramatic ways.

A longstanding critical tradition has an extensive list of claims to lay to the US media system’s structural deficiencies. Even in the pre-digital era, some scholars of communication were uneasy with the growing concentration of corporate ownership in media industries, seeing this trend as threatening the democratic process. Proponents of this intellectual current advocated for as wide a distribution of communication power as possible as a safeguard against power abuse at the hands of big corporate and state actors. The advent of digital news has seen yet another wave of similar criticisms, as it had soon become apparent that, contrary to early internet enthusiasts’ expectations, the new media ecosystem does not quite eliminate the disparities in communication power. Instead, it seemed to be reproducing the old patterns of power concentration, as well as giving rise to some new problematic trends.

Most of the contemporary media criticisms converge around one point: the digital news economy. The ad-based online business model often proves to be inadequate for sustaining certain forms of journalism that rely on specific and narrow audiences for financial backing. These forms happen to be the ones of social importance, like local news or investigative and issue reporting. Labelled the “attention economy,” the incentive system that social media news feeds have engendered rewards content that attracts eyeballs and generates clicks. Facebook and Google, which derive the bulk of their profits from selling targeted ads, have apparent reasons to stimulate as long user engagement with content as possible. Here’s where algorithmic newsfeeds come in handy, facilitating users’ selective exposure to content they will likely enjoy. Extrapolated to the political arena, this logic results in people getting locked up in ideological information bubbles, where partisan views become amplified and biases get confirmed. These bubbles also provide fertile soil for the spread of politically charged misinformation.

Aspiring media reformers have proposed multiple cures to these maladies. Among alternative models are philanthropic foundation-supported nonprofits, issue-specific donation-funded media outlets, and various forms of collaborative citizen journalism. Albeit sustainable in certain contexts, such solutions have so far failed to demonstrate flexibility and scalability needed to achieve any degree of mainstream adoption. Besides, these models mainly rely on goodwill of those people whose motivations are purely altruistic, which makes it difficult to ensure a steady flow of contributions.

A handful of blockchain-driven media startups that aspire to revolutionize the news economy are different in this important sense. They hope to not just draw in people longing for good journalism, but also provide them with economic incentives to contribute their efforts to sustaining the ecosystem for substantive news. Using the versatile incentive-building tools made available by crypto economy, combined with game-theoretic behavioral modelling and principles of decentralized governance, these projects aim at nothing less than creating comprehensive community-powered marketplaces for production, distribution, and verification of news.

A defining feature of each of these platforms is that they are all powered by the principles of the token economy. Unlike traditional fiat currencies or even a general-purpose cryptocurrency that could be used for any manner of transaction, crypto tokens are usually designed in a way that programmatically restricts the range of their uses to a certain set of roles and functions within a given system. Tokens therefore reflect the purposes and values of a certain platform, and can be used in order to align the economic interests of its individual users with the interests of the community at large. As a vehicle for transactions, such tokens are no longer a content-neutral instrument that simply enables transmission of information or value; rather, they entail the shared interests and values of those who subscribed to use them within a specific economic ecosystem.

Within the broader ecosystem of emerging blockchain-powered media startups, there is a wealth of platforms that use crypto-economic models to redefine the system of monetary exchanges between creators and consumers of information goods. The most common focus is on user-generated content and the ways in which regular folks in social media contexts are rewarded for their work: some examples include Steemit, Sapien, or Po.et, to name a few. The following review, however, focuses on a more specific set of projects, which explicitly address some problematic institutional aspects of the current news media system. As such, the projects in the list recognize the independent social value of news, and offer fixes that are designed to produce a better informed public.

Civil

A self-described decentralized marketplace for sustainable journalism, Civil is designed to solve the problem of “broken news” by addressing the deficiencies of ad-driven media economy. It will function as a platform hosting independent media organizations, called newsrooms, which will be bound by a code of professional ethics. Civil will operate on the Ethereum blockchain. Even though everyone will have access to the content produced by Civil newsrooms, the platform’s model of decentralized governance is organized around the community of CVL token holders.

The key mechanism for ensuring that journalists abide by the ethics code is that of token-curated registries, or whitelists. This model incorporates three categories of actors: 1) newsrooms, whose goal is to get whitelisted, and who place a token stake along with their application; 2) consumers, who are interested in having a high-quality whitelist of reliable newsrooms at hand, and 3) curators, whose interest lies in keeping the price of their tokens high by maintaining a reliable whitelist that is demanded by consumers. The game starts with an applicant depositing tokens in support of their application, which they get to keep in the case of being successfully whitelisted. Another option is that the applicant gets challenged by token holders and ultimately rejected over a vote, in which case curators split the deposit among themselves.

Although on the face it makes sense for curators to reject every single application and keep all the deposits, strategically they are incentivized to curate the list thoughtfully so that the value of their holdings stays high. The masterminds behind this system expect that, played repeatedly, the game will produce optimal outcomes for both the readers and token holders, while still allowing newsrooms to access the platform if their content meets the community standards.

The same mechanism will be employed for whitelisting third-party developers operating on the platform, as well as for challenging disputable content once it is published. Community governance will thus entail keeping tabs on content producers and creators of any add-on tools or applications, as well as ensuring the quality of specific news pieces. It goes without saying that the platform’s crypto economy will streamline the process of directly rewarding newsrooms from the readers’ pockets by the means of one-time or recurring payments.

Decentralized News Network (DNN)

DNN’s stated mission is to provide an infrastructure for factual political news that will be impossible to manipulate, infiltrate, or take down. The project creators’ ambition is for it to become a democratic alternative to mainstream media, which they regard as plagued with clickbait, distorting influences of corporate agendas, fake news, and “filter bubbles.” Similar to Civil, the responsibility of ensuring the consistency of content with community standards rests with the community members themselves, yet the mechanism is somewhat different. Whereas Civil’s model relies on “whitelisting” reliable newsrooms which are left with certain editorial latitude upon approval, on the DNN platform each story will undergo community review before it can be published.

There are four community roles in the DNN ecosystem: writers, reviewers, readers, and publishers. As there are no formally organized newsrooms, everyone will be able to take a shot at becoming a writer and publishing news. But before a story is recorded to the blockchain for everyone to see, a panel of seven reviewers will vote on whether it is in line with the community content guidelines. Along with submitting a story for review, the writer will pay a fee in DNN tokens; reviewers will also place their bids. Once the votes are in, the article gets either approved or rejected, and those reviewers who voted with the majority are rewarded from the writer’s fee, while those who casted minority vote have their bids forfeited. As the article goes live, readers can upvote and tip it, in which case both writers and majority reviewers get rewarded. This bidding game architecture is supposed to maximize the community benefit when all individual parties involved act selfishly.

One of the main concerns of DNN creators is the platform’s survivability in the face of malicious actors attempting to overwhelm or take down the network. The fourth community role, publishers, is reserved for computers that will store the network’s software in a decentralized manner.

Media Sifter

Media Sifter aspires to offer an environment for news consumption where attention economy is replaced with what its creators call “evidence economy.” Unlike Civil and DNN, Media Sifter’s main focus is not on production of the original news but rather on community validation and investigation of the outside content. The model comprises two major elements: news aggregator and a blockchain-based incentive system, built on a SIFT protocol, which enables collaborative validation and fact-checking.

The aggregator scrapes news stories from all over the web, presenting them to a user sorted in a number of ways: by topic, perspective, or geographic location. Once a reader engages with the content, they may open an “evidence bounty” in SFT tokens on any statement found in the text, calling for other community members to investigate. Those who decide to bring evidence to the highlighted claims are called investigators. Having done research on the statement’s subject matter, they either validate or invalidate the claim. This decision then goes to a panel of quasi-randomly selected reviewers who assess the quality of the investigator’s evidence, and rule on whether to approve it. This decision requires a consensus among reviewers. Once the fact check is validated, all the parties involved receive a share of the bounty, as well as credibility (CRD) points that go towards their personal ratings. The elaborate economy of the platform enables various forms of rewards for successful investigative work, including royalties and specialized subscriptions.

PUBLIQ

Despite many similarities to ‘ecosystemic’ platforms such as Civil and DNN, PUBLIQ has a number of distinctive features. The three pillars of its architecture are the content sharing layer, the transaction layer, and a reputation system. The latter serves as the key incentivizing mechanism for content producers. PUBLIQ will operate on its own blockchain with a modified Proof-of-Stake (PoS) consensus algorithm. Miners, who will obtain their node status by securing special ‘mining tokens,’ will seal a new block every 30 seconds or 2000 operations.

Unlike other platforms, PUBLIQ reserves a spot for advertisers in its ecosystem. Ads will be attached to all free content. According to the white paper, advertisers will have access to APIs, as well as to some the targeting algorithm. The AI assistant, whose main functions will be recommending articles to readers and presenting them with the full range of opinions, will also help advertisers to better target their messages. Readers can choose between paid subscriptions and free content containing ads. The difference from Facebook is that 100 percent of ad revenue will be distributed among authors and channels.

Other than that, the structure of economic exchanges looks familiar. Authors post articles along with a token stake, while readers can react with liking, sharing, or raising a flag. Based on readers’ feedback, authors receive monetary rewards and reputation points. A panel of forty most highly ranked authors reviews content that has received a certain amount of flags. Important decisions regarding the project’s development will be put up for a community-wide vote.

All the platforms reviewed are currently at the stage of alpha or beta testing, and it is yet impossible to tell whether their incentive models actually work in the ways their designers have intended them to. A lot will depend on the sheer numbers of people who will get inspired by the ideals behind these ambitious projects enough to become sufficiently committed to them. The fundamental problem with every system aspiring to rely on community-driven creation of value is that there are always limits to the resources, commitment, and enthusiasm that benevolent individuals are willing to bring to the table. Not every task performed by a paid professional can be crowdsourced. The question now is whether decentralization and smart incentive systems will turn every token holder into a paid professional.

While there could be reasonable doubts as to sustainability of these new models of journalism, the example of Wikipedia, a decentralized knowledge-producing community that shouldn’t have worked judging from any sober account of human nature, offers some hope. Regardless of the ultimate fate of these particular enterprises, there is little doubt that production and consumption of news is yet another industry that blockchain technology is about to shake up. Meanwhile, it will be exciting to watch the pioneers explore the uncharted terrain – or perhaps even join them in their endeavor.